Paying Without Cash is Fast Becoming the Norm!
A cashless economy is the one where all the transactions are done using digital means or through cards. In a cashless economy, the circulation of physical currency (notes/coins) is always minimal. In a country where cashless economy persist there are less instances of tax avoidance. In the year 2015, RBI spent Rs 27 billion on just on currency issuance and management. All this can be avoided if India becomes a cashless economy.
However, in recent time paying for things electronically through mobile phones, cards, mobile wallets and even through watches has become a trend and has made 80% of the transaction cashless in India. But this is limited to big cities and towns only, rural areas have yet to go a long way.
Current Scenario in India
No. of digital transactions has increased so far since November 8, 2016, When P.M Narendra Modi made an announcement abolishing ₹500 and ₹1000 currency in the country to terminate corruption and black money from the country. This step was also taken to control the outflow of the money illegally for illegal activities.
Demonstration effect was mixed but it is for sure that it has enhanced India’s digital economy. The reason behind this is a boost in digital transactions (online payments).
Business at digital payment company Paytm increased by more than 400% just in hours, within demonetization happened.
Mobile wallet applications Such as – Google pay, Paytm, Paypal, MobiKwik and many more now being preferred by a major number of people.
Benefits of Cashless Transactions
Reduced the Hassle
Whenever you conduct cashless transaction you need not worry about keeping cash with you. Purchase anything from gold to grocery and making payment digitally, all this reduces a lot of hassle which was persisting from decades. Keeping cash at home or carrying it in your pocket was also a kind of tension.
No Need to Search for Cash Points such as Banks and ATMs
When you deal with the cash you need to carry cash always. And is available only from two points first one is from the bank and another one is from Bank ATM. For any of these, you need to go either to the bank or to the bank ATM to get cash. But with the digital transaction, all such issue has been resolved. You just have to scan your mobile app. and your payment is done! How easy and convenient is this from carrying cash.
Getting Rid of Cash can Boost the Country’s Economy
With digital money or digital transactions, payments are traceable and hence, taxable too.
Digitalizing has a great impact on the economy of a country. As through digitalization all purchases and transactions can be tracked and recorded. This can work towards limiting the black market as well as stemming the flow of capital towards illegal activities such as to fund terrorist activities.
Economic Digitization also Increases the Government’s Ability to Enhance its Taxation Systems
India’s casual economy is responsible for generally 45% of GDP and 80% of employment, which implies that billions of INR are being exchanged every year without any taxation. At present, charge. No economy can go totally cashless. This will require a ton of biological system working to try and achieve an unmistakable limit. India socially trusts in real money and a change in outlook in deduction will require time and assets. Regardless of whether purposefully at the start of demonetization or not, this change in perspective was started by the Modi government on November 8, 2016. Cashless is presently the huge popular expression in India, and the ball is moving as the world’s biggest money economy starts going digital.
However, with the phenomenal rise in easy-to-use payment methods like UPI and Aadhaar-linked payments, India has already its journey towards becoming a cashless economy. Cashless Economy is now no longer a Dream of Future but an Expanding Reality for India.
According to the statistics provided by the Reserve Bank of India (RBI), 523.23 million cashless transactions worth Rs 93.63 lakh took place in November 2016. The country has witnessed a robust rise in the number of the cashless transaction after November 2016.
As a large number of people have started using mobile wallets and UPI-based payment apps, the government’s dream of making India a major cashless economy will soon turn into a reality. Making India one of the largest economies of the world.